Cathay Pacific offers early retirement scheme to older pilots

Cathay Pacific has already taken short-term measures including executive pay cuts and two rounds of voluntary special leave scheme to cut costs. (AFP)
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Updated 01 August 2020

Cathay Pacific offers early retirement scheme to older pilots

  • Cathay Pacific has already taken short-term measures including executive pay cuts and voluntary special leaves

HONG KONG: Cathay Pacific Airways said it will offer a voluntary scheme to its Hong Kong-based pilots who are approaching retirement age to leave the group early, in a continued effort to cut costs amid the coronavirus pandemic.
The airline said in an email to Reuters on Saturday it is looking at different ways to reduce costs in the medium term, given reduced passenger demand with no immediate signs of improvement. The retirement plan was first reported in local media.
Cathay has already taken short-term measures including executive pay cuts and two rounds of voluntary special leave scheme.
Pilots aged 50 or 55 and above, depending on the retirement age outlined in their contract as 55 or 65 respectively, are eligible to apply for the early retirement scheme, the carrier said. Pilots aged 58 and above at its regional arm Cathay Dragon are also eligible.
“The decision comes after careful consideration and is an effective way for the Group to manage costs. Addressing a specific group of employees for this dedicated scheme helps us adjust to the new operating environment,” the carrier said.
The scheme will pay pilots who retire early three months basic salary for each year remaining before their normal retirement age, plus a further one-month allowance payment up to a maximum of 12 months’ basic salary.
Cathay said management is doing a comprehensive review of all aspects of the group’s operations, and it will make recommendations to the board on the future size and shape of the airline by the fourth quarter.
The group was looking to cut costs, streamline marketing, consolidate pilot contracts and move veteran pilots to cheaper contracts, sources said.
Cathay last month warned it expected to report a HK$9.9 billion ($1.28 billion) loss for the six months ending June 30, including impairment charges on 16 planes. The estimated loss would be Cathay’s biggest half-yearly loss in at least a decade.


German economy to shrink by 5.2% this year, grow by 5.1% next year

Updated 22 September 2020

German economy to shrink by 5.2% this year, grow by 5.1% next year

  • The number of people out of work is seen rising to 2.7 million this year from 2.3 million in 2019
  • The Ifo institute cautioned that there was an unusually high degree of uncertainty attached to the forecasts

BERLIN: Germany’s Ifo institute on Tuesday said Europe’s largest economy would likely shrink by 5.2 percent this year, raising its previous estimate for a 6.7 percent drop, in the latest sign the damage caused by the COVID-19 pandemic could be smaller than initially feared.
“The decline in the second quarter and the recovery are currently developing more favorably than we had expected,” Ifo chief economist Timo Wollmershaeuser said.
For 2021, Ifo cut its economic forecast for Germany to 5.1 percent growth from its previous estimate of 6.4 percent. It expects the economy to expand by 1.7 percent in 2022.
The number of people out of work is seen rising to 2.7 million this year from 2.3 million in 2019, before edging down to 2.6 million in 2021 and then to 2.5 million in 2022.
That would translate into a jump in the unemployment rate to 5.9 percent this year from 5.0 percent last year. The rate would then drop to 5.7 percent percent in 2021 and 5.5 percent in 2022, Ifo said.
The Ifo institute cautioned that there was an unusually high degree of uncertainty attached to the forecasts. It pointed to the rising number of coronavirus infections, the risk of a disorderly Brexit and unresolved trade disputes.